Regal Cinema - All posts tagged Regal Cinema

The Hunger Games has dominated the box office for three weeks, but three new movies out this weekend make comparisons tougher and revenue looks set to decline.

MKM Partners analyst Eric Handler sees the box office generating 9% less as Hunger Games mania fades: He is predicting the weekend’s top ten films will generate $101 million versus $111 million last year. He still sees The Hunger Games coming out on top, despite new releases, earning $18 million, while The Cabin in the Woods, The Three Stooges and Lockout, all of which are making their debut, should earn $15 million, $14.5 million and $9.5 million, respectively. Battleship could boost international box office returns, as it has already earned more than $7 million during this week’s previews.

Handler writes that while the second quarter is off to a good start, comparisons are becoming tougher. Through the second weekend of the new quarter, the box office is up 20.3% based on Regal’s (RGC) fiscal calendar and is up 12.8% based on Cinemark’s (CNK) calendar. “Comparisons should become more difficult for the remainder of April, given the success of last year’s key releases Rio (4/15/11) and Fast Five (4/29/11). We are estimating a 4% decline for the 2Q12 box office, which compares with growth for the 2Q11 box office, based on the calendars for Regal and Cinemark of 3.1% and 4.4%, respectively. Comparisons are easier for IMAX (IMAX), which saw its global box office decline 6% in 2Q11, including a 32% decline in the average per-screen revenue from its domestic screens.”

Handler notes that film audiences are putting in a strong showing so far in 2012, easily topping traffic from early last year. As for Regal, he reiterated his Buy rating and $15 price target given an improving outlook and the company’s generous 5.9% yield, which he sees as safe and stable. He raised his first quarter estimates given better-than-anticipated overall first quarter box office trends, (he is projecting 18% growth, nearly double his previous 8.5% forecast.)

Handler reiterated a Buy rating and increased his price target on Cinemark by $1 to $26, also on the strength of 18% growth in the first quarter. He notes that this trend has eased fears about a weak domestic market following an underwhelming 2011 at the box office. He notes that while some may be concerned about weakness in Latin America, a part of Cinemarks’ growth strategy, a 12% increase in the number of screens should provide for low-single-digit international gains despite a drop off in attendence.

Finally, for IMAX, one of his top picks for the year, Hander reiterated a Buy rating and $29 price target. He expects the company to add 130 new screens in 2012 and raised his global box office forecast to $115 million for the first quarter, writing that The Hunger Games could generate more than $10 million on domestic IMAX screens this weekend and $14 million of box office revenue for the week.

Truffula trees trump monsters on Mars. At least that’s according to MKM Partners analyst Eric Handler, who expects The Lorax to maintain its top spot at the box office this weekend, despite the debut of John Carter.

In a note today, Handler writes that the box office is poised for year-over-year growth of around 2% this weekend, with the top ten films generating about $114 million in revenue, versus $112 million in 2011. He sees The Lorax, created by Illumination Entertainment and Comcast‘s (CMCSA) Universal Pictures, taking the top spot, grossing $39 million, and Disney‘s (DIS) John Carter bringing in $27 million.

He also notes that so far, first quarter box office revenue is up 19.2% based on Regal Cinema‘s (RGC) calendar and up 23.7% based on Cinemark‘s (CNK) calendar, putting it on track to come in ahead of his expectation for 8.5% growth and the consensus of 8% for the full first quarter.

Here is more detail from his note:

The Lorax should repeat as the box office champion this weekend. The film scored a very strong A CinemaScore last weekend, and with no real family competition in the market right now, is likely to see a solid hold in its sophomore frame (we estimate a respectable 45% decline). Premium ticket sales are likely to take a hit, though, with a modestly lower 3D screen count and fewer showings on IMAX screens, which transition over to John Carter this weekend.

John Carter is reportedly tracking toward the high end of a $25-$30mn range. Reviews for the film are unspectacular, with a 47% Rotten Tomatoes score. The film is likely to have a narrow, male-skewing audience, which should allow IMAX screens (290 locations) to over-index and account for 12%-15% of total revenue.

The weekend’s two other new releases, Silent House and A Thousand Words, are likely to open to less than $10mn over the three-day period. Silent House has no significant horror competition, and its lead, Elizabeth Olsen, is one of Hollywood’s hot, rising stars. A Thousand Words is largely expected to bomb, as revenue expectations are in the $5mn range and the theater count is just 1,890 locations. Eddie Murphy’s days as a star attraction have long passed, as (seemingly) has his ability to select quality content (0% Rotten Tomatoes score).

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